Buying stocks isn’t for everyone, especially those on a budget. But there is a way for even those to invest for their future. Sharebuilder is one such site.
Why do most people never save any of their money? The most common reason is they don’t think they make enough to save any of it. While it is true that excess money should pay off debt, it isn’t always a good excuse not to save anything. If invested properly, the payoff could be larger than any interest paid on debt.
That of course is the first thing a consumer should do, decide if the potential earnings would outweigh the interest on debt. Let’s say credit card debt has a 10% interest rate, but the investment would pay off 15%. In this case it would make the most sense to invest.
On the other hand, why not do both? Put most of the disposable cash on debt and leave a little aside for investing. How much to invest depends greatly on a person’s budget. How much does he/she have left over after paying all bills? Even if it’s only $5, it’s better to save it than waste it on an expensive cup of coffee or a magazine.
Even Saving $5 is Better than Nothing
The problem that most people might run into is that they feel it’s not worth saving $5, but that’s not true. Any amount that can be set aside now, can compound and grow in the future. Anyone with a bank account can set up automatic withdrawals to fund all different kinds of investments. While some do have a minimum of anywhere from $50 to $100, there are a few with no minimum.
Sharebuilder.com is one such site. It is very easy to set up a weekly, bi-weekly or monthly withdrawals for any amount of money, even $5. There is also the option of having that $5 deducted from a paycheck. This can accumulate until there is enough to make a stock purchase. So for anyone out there who has always wanted to invest in stock but wasn’t able to, now you can!
It only costs $4 per transaction with Sharebuilder, and the site allows its customers to purchase whatever stock they choose at whatever they can afford. So it doesn’t matter if a particular stock costs $100 a share. If the investor only has $25, they can own a quarter share of that stock.
Discount Stock Traders Save Investors Money
A site that allows this is rare, among other popular discount stock traders such as etrade.com and tdameritrade.com. While both of these are reputable companies, stocks must be purchased in whole increments, and their fees are higher. To find more, simply enter “discount stock traders” into any search engine, but be cautious about using any new company. There are plenty of scams out there.
So far Sharebuilder is the best site this investor has found, which helps explain why it has grown so much since its humble beginnings. They do offer real-time trades as well, for a bit more money, as well as offering bank accounts, CDs and loans. This site is one-stop shopping for the investor on a budget.